1. Chapter 9 Industrialization
Section 1
The Rise of Industry
Chapter 9 Industrialization

2. Warm up Write the Question and Answer:
What was the Homestead Act of 1862 and what was its impact?
What was the Dawes Act and what was its purpose?

6. The US Industrializes Natural Resources
Lots of raw materials – water, timber, coal, iron and copper. Many of these resources were located in the West. The settlement after the Civil War helped to accelerate Industrialization
A new resource – petroleum was just beginning to be tapped. (Kerosene)
Edwin Drake – 1859 – drilled the first oil well near Titusville, Pennsylvania. As oil production increased, it fueled economic expansion.

7. Edwin Drake

8. The US Industrializes A Large Workforce
Between 1860 and 1910 the population nearly tripled.
Increased workforce and demand for consumer goods.
Large families and massive immigration
Conditions in China and Eastern Europe were not good.
– 20 million immigrants

9. Free Enterprise
Americans embraced the idea of laissez-faire which means ‘let do’ a French phrase that means ‘let people do as they choose’ Lack of government control.
Relies on supply and demand
Low taxes and low government debt
Entrepreneurs – people who risk their capital in organizing and running a business.

10. Government’s Role in Industrialism
For the most part the government stayed out of the way. This policy produced results other than what had been intended.
Sectional tensions between North and South early 1800s
North – high tariffs and subsides
South – low tariffs and promote trade
The Civil War ended this debate
Republicans passed the Morrill Tariff (raised tariffs)
High tariffs stayed even though they weren’t part of Laissez-Faire. Felt they were needed.

11. New Inventions Bell and the Telephone Edison and Electricity
Alexander Graham Bell – invented the telephone. Revolutionized communications. Created the Bell Telephone company and later became the American Telephone and Telegraph Company (AT&T)
Edison and Electricity
Thomas Alva Edison – worked to invent new products
Invented the Phonograph, lightbulb, electric generator, battery, dictaphone, mimeograph and the motion picture.
1882 – Edison Electric Illuminating Company – new industry providing electric power to New York City.
Several of Edison companies merged into the Edison General Electric Company, which is known today as GE

12. Bell

13. New Inventions Technology’s Impact
Technology became a part of most everyone’s life.
Thaddeus Lowe invented the ice machine – basis of the refrigerator. Gustavus Swift and the refrigerated railroad car – fresh meat delivery.
Technology changed the shoe and clothing industries as well.

14. Warm-UP Remember from Section 1
Describe the concept of laissez-faire.
What is an entrepreneur? Give two examples of entrepreneurs. Who are they and what did they do?

15. Chapter 9 Section 2
The Railroads

17. Linking the Nation
By 1900 the U.S. had over 200,000 miles of railroad.
The railroad boom began in 1862 when the Pacific Railway Act was signed.
What was the name of the 2 railroads that built the transcontinental railroad?
Union Pacific & the Central Pacific
~ 10,000 workers
~ 10,000 animals
1 mile of track

18. Four merchants known as the “Big Four” invested in the Central Pacific Railroad.
Leland Stanford.(grocer)
Charley Crocker (shop owner)
Collins P. Huntington and Mark Hopkins (Hardware store owners)

19. Leland Stanford Gov. of CA U.S. Senator 1885 Founded Stanford Univ.
Headed the Central Pacific railroad
Employed tons of Chinese

20. Transcontinental railroad
Spurred Industrial growth by linking:
The Nation
Railroads increased the size of markets for many products
Stimulated the economy by spending lots of money on steel, coal, timber

21. Cornelius Vanderbilt Famous Railroad Consolidator
Had built the largest steam boat fleet in America
1869 – was able to offer the 1st direct rail service between New York City & Chicago

22. Time Zones
Before the 1880s, regions set their clocks by the sun’s position in the sky.
To make rail service more safe, in 1883 the American Railway Association divided the country into 4 time zones.
What are these time zones called?

25. Land Grant System
To encourage railroad constructions the federal government gave land grants to many railroad companies. A land grant is a piece of land that is given to someone.
Railroad companies made most of their money by selling government land grants.

26. Robber Barons
Scandals created the impression that railroad entrepreneurs were robber barons, or people who looted an industry and gave nothing back.
Jay Gould – practiced “insider trading.”
He used information he received as a railroad owner to manipulate stock prices to his benefit.
James J Hill (Was NOT a robber Baron) – built & operated the Great Northern railroad from St. Paul MN to WA

27. Credit Mobilier 1872
A construction company set up by several stockholders of the Union Pacific.
Scandal included many government officials.

28. Section 3: Big Business By 1900Big Business dominates the economy
Wouldn’t be possible w/o the Corporation, the people who own the Corporation are called the Stockholders
Why: Because they own ownership of that company (AKA Stock)
When people invest in these companies they are able to sale more and produce goods more rapidly

29. Even though falling prices help consumers they hurt business so
Even though falling prices help consumers they hurt business so . . .they pulled t/g to form POOLS AKA agreements to maintain prices at a certain level.
These were generally unpopular & did not last long

30. Andrew Carnegie & Steel
Born in Scotland
Started as a railroad Superv.
1875 opened a steel comp. in Pittsburgh, PA
1st to use the Bessemer Process – a new process of making steel easy & cheaply
Known for Vertical Integration – owns all of the factors of production for its business

31. Vertical Integration
Distributer
Raw Materials
Assembly
Manufacturer

32. Horizontal Integration
John D Rockefeller is an example
Combining many firms in the same type of business (this can limit competition)
1880 John D. R – owned 90% of the oil refining industry
When a company receive control over the entire market than it becomes a Monopoly
Americans don’t like this why? . . .

33. 1882 Standard Oil formed the first TRUST
Trust - A new way of merging businesses that did not violate the laws a/g owning other companies
Holding companies – does not produce anything itself , it owns stock in the companies that do produce goods
Selling the Product – Advertising (90 mill per yr) flyers, magazines, bill boards, newspapers
* Department Stores emerged by 1877 – most popular was Woolworth’s, later came Macy's, Marshall Fields